A California woman is suing Verizon Communications for selling her faster Internet service, at a higher price, the company cannot actually deliver.

Patricia Allen of Santa Monica filed suit in Los Angeles after Verizon sold her an upgrade to her current DSL plan that turned out to be anything but.  Allen was paying $23.99 a month for 768kbps service, but in March, 2011 Verizon promised they could give her a speed upgrade to 1.5Mbps for $11 more per month.

Exactly one year later, Allen learned her “upgraded service” performed no better than her original Internet plan, which itself only managed around 500kbps, and called Verizon to complain.

Verizon technicians quickly responded Allen could never get the benefits of a faster speed plan because she lived at least two miles from her local Verizon central office.  DSL speeds degrade with distance and can also be impacted by the quality of the landline network Verizon maintains in southern California.  Because Allen lives too far away to receive anything better than 700kbps service, she was advised to downgrade her $34.99 DSL plan back to the one she started with.

Allen requested a refund for the extra $11 a month she was paying for the last year for promised speed improvements Verizon never delivered, but the company flatly refused her request.  Allen is now taking her case to the California courts, and her legal representatives are seeking to have the case designated a class action covering all Verizon landline customers in California who, like Allen, are paying for Verizon-marketed speed upgrades they actually cannot receive.

The suit claims Verizon is well aware it is selling speed upgrades to customers who live too far away from the company’s facilities to actually benefit from the enhanced service, and pockets the proceeds without delivering improved service.  The suit alleges Verizon is engaged in unethical, unscrupulous, immoral, and oppressive business conduct in violation of California state law.

Verizon’s spokesman Rich Young called the lawsuit “baseless and without merit.”

Verizon Class Action Copy

Verizon Communications will stop selling DSL broadband-only service to its customers May 6th in what the company is calling an effort to control costs “enabling us to continue providing competitively priced services to existing and new customers.”

Broadband Reports readers first reported receiving written notice of Verizon’s plans to discard “naked DSL” service, although existing customers who don’t move or make any changes to their account will be able to keep the broadband-only service for now.

Verizon provides the details:

Beginning May 6, 2012, we will no longer offer High Speed Internet without local voice service on the same account.

What does this mean for you?

• If you currently have High Speed Internet without local voice service on the same account, there is no action required on your part to continue enjoying your internet service. You will not experience any disruption of service.
• Prior to May 6, 2012, you can still make speed upgrades or downgrades to your existing service.
• Prior to May 6, 2012, you can receive bundle discounts by adding DIRECTV service or Verizon Wireless service to your current internet service.

What this means if you change or disconnect your High Speed Internet Service as of May 6, 2012 or after:

• You can make changes to and retain your Verizon High Speed Internet Service on or after the above date, by adding Verizon’s local voice service to the same account.
• If you are moving your service from one location to another on or after the above date, you may subscribe to internet service at your new location if you also subscribe to Verizon’s local voice service on the same account.
• If you choose to subscribe to additional Verizon services you could be eligible for a bundled discount when you also subscribe to Verizon’s local voice service on the same account.

There is speculation Verizon is eliminating its DSL-only service in an effort to boost revenue and push subscribers in FiOS-enabled areas to Verizon’s fiber optic network.  A decade earlier, many phone companies fought to avoid selling “broadband-only” DSL service without a voice landline because of revenue losses.  Landline customers continue to drop voice service from traditional phone companies at an alarming rate — choosing competing cable or Voice over IP service or a cell phone.  By requiring voice service, Verizon can boost average revenue from each customer, whether those customers want the service or not.

Customers who currently subscribe to broadband-only DSL service from Verizon are advised that virtually any account change of significance can disqualify them from continuing with the service.  That includes address changes and speed adjustments.  Stop the Cap! recommends customers make any changes prior to May 6th.

Large sections of Verizon’s service area are not FiOS-eligible,  so current DSL customers with no other broadband choices may find themselves stuck with adding voice service. Verizon sells Basic Home Telephone Service with no local calling allowance at prices ranging from $7 in some communities to $16 or higher in others, excluding the FCC-mandated line fee, which runs an extra $6.50 a month.

One thing Verizon’s higher bills will accomplish is making Verizon Wireless’ new 4G LTE Home Fusion wireless broadband service look slightly more price competitive.  If a Verizon landline customer has to pay for both voice and data service, paying $60 a month for 10GB of wireless broadband may not seem that expensive in comparison.

Stop the Cap! has learned Frontier Communications is laying the groundwork to upgrade selected areas of its network to deliver fiber-to-the-neighborhood service to some of its customers, perhaps as early as the last quarter of 2012.  Documents obtained by Stop the Cap! indicate the company is negotiating with AT&T to license U-verse technology to deliver the service.

The documents suggest Frontier’s 2011 negotiations with AT&T to resell mobile phone service to Frontier customers have now expanded to include the development of improved broadband at a cost less likely to antagonize Wall Street and the company’s investors.

Sources familiar with Frontier’s operations tell Stop the Cap! although the company will continue to support Verizon-acquired FiOS fiber-to-the-home networks in Indiana and the Pacific Northwest, Frontier plans to rely on less-expensive alternatives for the rest of its service areas and has no plans to further expand the FiOS branded fiber-to-the-home service.

For the most rural customers, Frontier appears ready to partner with HughesNet to resell a satellite broadband product to customers considered unsuitable for basic DSL service.  Frontier will continue to invest and upgrade its traditional 1-3Mbps ADSL service in rural states like West Virginia, Idaho, Nevada, and South Carolina.  The company is also planning to upgrade selected cities to VDSL — a more advanced form of DSL needed to support a U-verse offering.  Perhaps one major target for such an upgrade is Frontier’s largest service area — Rochester, N.Y., where Time Warner Cable has systematically picked off Frontier’s landline customers for years with offers of faster broadband speeds and better package pricing.

Frontier's headquarters in Rochester, N.Y.

Frontier’s insistence customers don’t need faster broadband speeds, a statement made repeatedly by Frontier Rochester general manager Ann Burr, has cost the company market share, especially for high speed Internet service.  Although Frontier claims to offer speeds up to 10Mbps in Rochester, the company only manages to deliver 3Mbps in some of the city’s nearest suburbs.

An upgrade to U-verse, while not as technologically advanced as fiber to the home service, would help Frontier defend its position in more urban markets, especially as cable companies upgrade their own infrastructure to market faster broadband speeds.

AT&T U-verse sells broadband at speeds of 3, 6, 12, 18, and 24Mbps.  Time Warner Cable, Frontier’s largest competitor in upstate New York, sells speeds of 3, 10, 20, 30, and 50Mbps.

Frontier Communications has been preoccupied integrating its newest customers, acquired from Verizon Communications in 2009, with their existing IT and operations systems.  The company recently touted it completed transitioning former Verizon operations, financing, and human resources with its own information technology network nine months ahead of schedule.

Frontier has been reorganizing some of its internal departments in preparation to launch several aggressive initiatives in 2012, especially in its efforts to roll-0ut more competitive broadband — considered a landline lifesaver —  in areas where the company has lost a lot of business to its cable competitors.  The company also intends to spend tens of millions upgrading its regional and national broadband infrastructure and continue extending DSL service to presently unserved rural areas.

Another planned improvement is an overhaul of Frontier’s website, which has brought complaints from customers for delivering inaccurate information, making online bill payment cumbersome, and being difficult to navigate.

Documents obtained by Stop the Cap! also reveal the company has made progress on its plans to pitch AT&T cell phone service to Frontier customers.

Frontier signed a resale agreement with AT&T last fall and is on track to begin limited trial offers of AT&T cell phones, smartphones, and tablets — with full access to AT&T’s network of 29,000 Wi-Fi hotspots during 2012 with a more widespread rollout in 2013.  Frontier plans to offer customers the option of a single bill for Frontier and AT&T services.

Frontier’s Karen Miller told Stop the Cap! the company had no comment about today’s story.

AT&T has joined Verizon in a groundbreaking decision to stop allowing bogus charges on customer’s phone bills.

Senator Jay Rockefeller (D-W.V.) publicly thanked AT&T for joining with Verizon to stop the fraudulent fees, which a recent Senate investigation found netted at least $10 billion over the last five years.

“AT&T made the right decision to end cramming by August,” Rockefeller said. “While the decisions of AT&T and Verizon are a step in the right direction, I still believe we need to pass a bill that bans this abusive practice once and for all.”

Phone companies have been reluctant to stop third-party billing because it represents lucrative revenue for companies that have watched their landline customers disconnect and disappear.

“According to financial information my staff has reviewed, telephone companies earn a dollar or two every time they place a third-party charge on their customers’ bills,” Rockefeller said. “Do the math. That’s well over a billion dollars in profit over the past decade.”

AT&T suggested the cramming problem was overblown, but relented anyway.

“We currently receive cramming complaints for only about one out of every thousand bills that contain third-party charges,” said Michael Balmoris, an AT&T spokesman, in a statement to MSNBC.  “However, due to continued concern over the possibility of unauthorized charges, we have decided to take this additional step and eliminate third-party billing for most types of services.”

In late March, Verizon notified its billing partners it would cease third-party billing by the end of 2012.

"You are not subscribed... to any channels."

An angry commentator on WHP-TV in Harrisburg summed up his recent misadventures with Verizon’s customer service on the 6pm nightly news:

“Verizon Service Sucks!”

R.J. Harris was just one of thousands of Verizon FiOS customers across the northeast who found themselves without FiOS television service March 23rd, forcing many to miss NCAA basketball tournament games and the season premiere of “Mad Men.”

Because of a software glitch, Verizon’s media hubs in Buffalo and Harrisburg, Pa., shut off cable networks in FiOS cities across the northeast.  Viewers were told they were “not authorized” to receive cable networks, which brought many to the phones to call Verizon for help.

Harris joined enormous call queues that extended one, two, even three hours before most gave up.  Even worse: Verizon’s automated customer service agent provided voice synthesized non-answers regarding the FiOS outage.

“Lots of ‘press one,’ ‘press three,’ blah blah blah and then a talking computer,” Harris recounts. “One day later I tried to use Verizon’s ‘in home agent’ on my PC to get help.  Verizon took almost two hours to update my software before I could use the agent.”

Harris finally ended up in a chat session with “Sandeep,” half a world away.  But Harris found the offshore customer service agent was the first person to actually explain the problem.

“I told Sandeep I wanted management to know how I felt about my customer service experience,” Harris said. “He obliged by getting his boss Muhammad to join the chat. Muhammad — the manager — added one word to the chat: ‘OK.’ That’s it.”

“If you are starting a new company in America and you want the worst customer service policy you could possibly have, model your company after Verizon.”

[flv width=”360″ height=”290″]http://www.phillipdampier.com/video/WHP Harrisburg Common Sense 3-29-12.mp4[/flv]

WHP-TV commentator R.J. Harris is furious at Verizon for its FiOS and customer service failures.  (3 minutes)

Customers around the northeast shared one thing in common: they couldn’t talk to anybody at Verizon about the mishap.

Barbara Adams in Latham, near Albany, found that to be the case.  Adams called the local newspaper for help instead, which they gave her.  A Verizon FiOS customer near Buffalo ended up getting technical support from a friend’s Facebook page.

Harris

Verizon’s technical glitch required customers to follow a fairly complex set of instructions to fix the problem:

1. With the TV and set-top box on, press Menu on the remote.
2. On the TV screen scroll to Customer Support, selecting In-Home Agent.
3. Select STB Auto Correct and follow any directions after that.
4. The process should take several minutes.

Last week, Verizon began rebooting its home set top boxes remotely to reset them to working order without customer intervention.

But many customers were left without service all weekend long, unable to reach anyone at Verizon to understand why.

The company would not make a definitive statement about providing affected customers with service credits, but if you were affected, we recommend you call or write and ask for yours.

[flv width=”360″ height=”290″]http://www.phillipdampier.com/video/WNLO Buffalo Verizon FiOS Problems 3-27-12.mp4[/flv]

WIVB in Buffalo talked to a local Verizon FiOS customer who found a solution to Verizon’s technical snafu, from a friend on Facebook.  (2 minutes)